Money · المال

Bahrain Corporate Tax

Personal income tax: 0%. Corporate tax: 10% on profits above - with QFC carve-out and Bahraini-ownership exemption.

Last reviewed 27 April 2026· Source: Bahrain General Tax Authority - Corporate Tax
Choose an entity type to see the applicable tax treatment.
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How Bahrain corporate tax works

Federal Decree-Law No. 47 of 2022 introduced Bahrain corporate tax with effect from 1 June 2023. The first of taxable profit is exempt; profit above that threshold is taxed at 10%. There is no personal income tax.

Free Zone entities that meet the Qualifying Free Zone Person tests can pay 0% on qualifying activities, but non-qualifying income - including most business with mainland Bahrain - is taxed at 10%. Bahraini-owned businesses (and the Bahraini share of mixed-ownership) are exempt from corporate tax.

Worked example

A mainland LLC posts BHD 1,000,000 in taxable profit. The first is exempt. The remaining BHD 625,000 is taxed at 10%, giving a tax bill of BHD 56,250.

Quick formulas

Tax = profit × 0.10 (foreign share only).
Effective rate = tax ÷ profit.
QFC qualifying activities at QFC-specific rate (typically 10%) (subject to conditions).

Frequently asked questions

Does Bahrain have personal income tax?
No. Salaries, capital gains and investment income are not taxed at the federal level.
What is Bahrain corporate tax rate?
0% on the first taxable profit (no threshold) for foreign-owned companies; 0% for fully Bahraini-owned.
How are Free Zone entities taxed?
QFC entities pay 0% on qualifying activities; non-qualifying income is taxed at 10%.
What is Small Business Relief?
Resident businesses under BHD 3 million in revenue can elect zero taxable income, subject to FTA election rules.
Is there a 15% Pillar Two top-up tax?
Yes - for multinational groups with consolidated revenue above EUR 750 million. This calculator covers the standard 10% regime only.

Reference only. Free Zone qualifying tests, transfer pricing and group relief rules are complex - consult a Bahrain tax advisor before filing.